Advantages of floatation of new shares, Finance Basics

Advantages of Floatation of New Shares

1. It facilitates the matter of securities to increase new finance, creation a company less dependent on retained earnings and banks.

2. The wider share ownership that results will raise the likelihood of being capable to compose rights issues.

3. The transfer of shares becomes much easier. Less of a commitment is essential on the part of shareholders. For this cause the shares are likely to be perceived like a less risky investment and thus will contain a higher value.

4. The greater marketability and thus lower risk attached to a lower cost to a market listing will lead of equity and to a weighted average cost of capital also.

5. a market-find out price because shareholders will distinguish the value of their investment all times.

6. The share price can be utilized via management as a sign of performance, particularly while the share price is forward looking, individually based upon expectations, even as other objectives measures are backward looking.

7. The shares of a quoted company can be utilized more readily like consideration in takeover bids.

8. The company may raise its standing via being quoted and it may get greater publicity.

9. Getting a quotation provides an entrepreneur along with the opportunity to realize part of his holding in a company.

Posted Date: 2/1/2013 1:38:32 AM | Location : United States







Related Discussions:- Advantages of floatation of new shares, Assignment Help, Ask Question on Advantages of floatation of new shares, Get Answer, Expert's Help, Advantages of floatation of new shares Discussions

Write discussion on Advantages of floatation of new shares
Your posts are moderated
Related Questions
The Beta of several industry sectors is shown below. Industry                                                                                            Beta (β) Banks

Compute the future value of $2,500 compounded annually for 10 years at 6%

From the above case shareholders are very worried that apple is having too much cash,discuss six reasons why shareholders are so worried

what are the modern methods of evaluating capital projects? how they different from old methods?

Fixed Asset and Total Asset Turnover Ratio Fixed asset turnover = Annual Sales / Fixed Assets This ratio indicate the efficiency along with which, the fixed assets we

capital structure of 38% common stock and 62% debt. A debt issue of 1000 par value, 5.6% bonds that mature in 15 years and pay annual interest will sell for $979.dividends have gro

Since 1968, Dracula Limited has traded in Doncaster, South Yorkshire as a manufacturer of fancy-dress and theatrical costumes. It produces a wide range of general theatrical costum

Example of Valuation of Bonds and Debentures K is contemplating purchasing a 3 year bond worth 40,000/= carrying a nominal coupon rate of interest of 10 percent.  K necessary

Suppose the ABC Corporation is currently all-equity financed and would like to increase its value by issuing debt. The firm has annual earnings before interest and taxes of $7,0

Stock Exchange Market The Idea and improvement of a Stock Exchange Stock exchange also identified as stock markets are special "market places" whereas already held bond